Health insurance: Obamacare transforming the industry

The U.S. health insurance industry is undergoing rapid transformation. The change is mostly being brought about by the unending rise in medical costs, price-and service-consciousness among consumers, fierce competition, shift of customer mix, uncertain economic conditions in the U.S. and abroad, and the pressures created by the health care reform law.

The health and medical insurance industry is an integral part of the U.S. economy. According to the Centers for Medicare and Medicaid Services, health expenditures account for approximately 18% of the country's annual gross domestic product. The World Health Organization has stated that health care expenditure per person in the United States is the highest in the world.

Despite the large amount of money spent on health care, the quality of care has been inferior and millions of Americans lacked health insurance coverage or were underinsured. This was mostly due to a dysfunctional system that was in place for several years. To expand coverage, President Obama introduced drastic health care reforms in March 2010, aimed at bringing down the country’s uninsured rate and reining in medical-cost inflation.

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